LEARNING FROM SCHELLINGS STRATEGY OF CONFLICT Thomas.pdfVIP

LEARNING FROM SCHELLINGS STRATEGY OF CONFLICT 1 by Roger B. Myerson /~rmyerson/research/stratofc.pdf Abstract. Thomas Schellings Strategy of Conflict (1960) is a masterpiece which should be recognized as one of the most important and influential books in social theory. This paper reviews some of the important ideas in Strategy of Conflict and considers some of the broader impact that this book has had on game theory, economics, and social theory. By his emphasis on the critical importance of information and commitment in strategic dynamics, Schelling played a vital role in stimulating the development of noncooperative game theory. More broadly, Schellings analysis of games with multiple equilibria has redefined the scope of economics and its place in the social sciences. JEL Classifications B21, C72, D74, F51. Authors address: Roger Myerson, Department of Economics, University of Chicago, 1126 East 59th Street, Chicago, IL 60637. Email: myerson@ . Internet: /~rmyerson/ First version: Aug 2007; latest revision: April 2009. 1Prepared for a conference at the University of Maryland in honor of Thomas C. Schelling, Sept 29, 2006. 1 Introduction Thomas Schellings Strategy of Conflict (1960) is a masterpiece which should be recognized as one of the most important and influential books in history of social science. Indeed, in just the first three chapters, Schelling introduced enough ideas to revolutionize social theory. Chapter 1, entitled The Retarded Science of International Strategy, begins with a call for a new theory of interdependent decisions, to provide a framework for analyzing problems of conflict and deterrence that arise in international relations. Chapter 2, An Essay on Bargaining, considers basic questions about how people achieve commitment to strategic threats and promises.